From Pop Star To Startup Boss: The Story of Stageit's Evan Lowenstein

On the screen of his MacBook, Evan Lowenstein watches singer-songwriter Jason Manns strumming an acoustic guitar in his apartment, where the only audience member is a snoozing dog. Yet out in the ether, thousands of humans are tuning in–as you can see by the comments cascading down the right side of the screen and by the real donations clattering into a virtual tip jar. “That’s $100 right there. There’s another $20,” says Lowenstein, 38. Manns has already earned $1,800. “The cool thing is he’s just some guy. But he’s got a fan base.”

Tan, lean and still pop-star cute, Lowenstein hasn’t changed much in the dozen years since his one-hit sensation (“Crazy for This Girl,” made with identical twin brother Jaron) rocketed near the top of the charts. Today he is wrestling with a startup, still trying to get it off the ground after spending five years and $500,000 of his and his family’s money. Stageit.com, a concert-streaming site that generously rewards musicians, isn’t profitable. Given the long string of Lowenstein’s mistakes, it probably shouldn’t exist at all. But through charm and tenacity–and dumb luck–he has built a growing audience and an impressive, if credulous, group of investors.

They include Sean Parker and Jimmy Buffett, who have contributed to the $3.5 million in total venture funding. “As a business model that thing really works,” says Buffett, who recently used Stageit to raise $20,000 for charity in a 20-minute performance from his dressing room before a show at Detroit’s Comerica Park.

With Stageit artists set ticket prices (starting at 50 cents), often on a pay-what-you-can model. They keep 60% of that, twice what most mainstream arena acts take home; the rest covers Stageit’s setup costs and licensing fees, leaving gross margins of 25% to 30%. Concerts can be held anywhere there’s an Internet connection and a videocamera.

“The back of a car, the back of a bus, the kitchen counter,” says Lowenstein. “Pretty much anywhere you can have sex.”

The roster of musicians has swelled with the likes of aging stars (Bonnie Raitt, Rick Springfield, Jackson Browne) and newer faces like Jason Mraz and Pomplamoose. On average fans now spend $12 per show, twice as much as a year ago, and each show generates $375 in ticket sales, a threefold increase. More than half of all revenue comes from the tip jar. Stageit’s sales reached $340,000 in the third quarter, up from $60,000 a year earlier. The company will probably lose $700,000 on revenue of $1.3 million this year.

Evan and Jaron were discovered by Buffett back in 1996, when they were playing bars in Atlanta. He helped them land a deal with Universal’s Island Records. One potential roadblock: religious observance. “I knew they were Orthodox Jews who wouldn’t work on Saturdays,” Buffett recalls. No problem. “Crazy for This Girl” climbed to 15 on the Billboard Hot 100 in 2000. After their third album flopped, the brothers formed a production company and shot pilots for TV shows, becoming hosts of USA Network’s Character Road Trip for four seasons.

Life as a Web entrepreneur has been more challenging. “I’ve had a lot of success in my past from trusting people,” says Lowenstein. “In tech I didn’t know the rules of the game. I didn’t have a good bullsh*t detector.”

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